When Julius Ibrahim became increasingly more interested in tackling homelessness, he opened Second Shot Coffee, a social enterprise café in East London.
Second Shot Coffee believes that anyone coming into the café shouldn’t have to sacrifice anything from their customer experience. And as Julius explains, the social impact the café provides is a bonus.
Second Shot Coffee trains, employs and supports people affected by homelessness. The social enterprise also has a ‘pay it forward’ system, which means customers can pre-pay for drinks or food that a rough sleeper can get a free coffee or meal at a later point.
One of the main challenges to make the social enterprise a reality was in getting the initial funding for it. But he explains how Social Investment Tax Relief (SITR) was a game-changer.
SITR helped Second Shot Coffee access funding and investors. But it also helped them raise the money to actually get Second Shot Coffee up and running.
What SITR offered for us is obviously the access to funding and the access to investors. But it also meant that, in the way that it’s structured, we could get the capital to get off the ground.
Repayments on SITR investments don’t start for at least three years after the investment is made. It allows eligible social enterprises and charities to access unsecured investment – either via loans or equity.
Second Shot Coffee is a Community Interest Company (CIC). To date, they have raised £100,000 using SITR through a direct deal.
You can also learn more about Julius’ experience of raising investment using SITR in this 'hear from a peer' webinar. He shares his journey from finding out about SITR to opening up the café, which included registering as a CIC, getting advance assurance and delivering an investor presentation.
Julius also explains that because SITR offers investors a 30% tax relief on eligible investments, the investment is less risky. This meant that they could offer a lower rate of interest.